TopHat gives up on bid for ‘commercially viable’ position in UK modular sector

TopHat said it had been unable to secure any new “large-scale contracts” due to a “challenging market environment” and competition from house builders.

The firm initially revealed in October it planned to wind down its modular operations. It started this process after it stopped trading.

The news comes after a series of setbacks for the firm, which included pulling plans to open a new mega-factory in Northamptonshire.

The decision to stop trading follows the failure of other major volumetric players since 2022, including Ilke Homes, Legal & General and House by Urban Splash, a JV that included Homes England.

TopHat Industries, which oversaw the firm’s factory operations, reported widening losses of £46.3m in the year to the end of October 2023. Another subsidiary, TopHat Communities, responsible for development, reported widening losses of £28.9m.

TopHat said it had traded at “low levels throughout the year” and market conditions had “worsened as the year progressed”.

Since launching in 2016, the firm has completed homes for Medway Council and Urban & Civic, and worked with Boklok, a JV between construction giant Skanska and retailer Ikea. 

Manchester-based housing association Together Housing also announced in October 2023 that it was working with TopHat to deliver 41 homes on a scheme in Blackburn. 

FTSE 100 house builder Persimmon had invested £25m in TopHat, but said last summer that it was writing off the investment. Aviva Investors had also invested £20m in the firm for an undisclosed stake. 

The modular firm also took a £15m loan from Homes England in November 2023. The funding was secured through the agency’s Levelling Up Home Building Fund. 

TopHat was also on a framework established by Building Better, which is backed by the National Housing Federation.